PRELIMINARY FINANCIAL STATEMENT 2016JANUARY – DECEMBER

2 Q4 2016 ATRIUM LJUNGBERG

NET SALES totalled SEK 2,299 million (SEK 2,468 m), of which rental income increased to SEK 2,150 million (SEK 2,122 m). Rental income in comparable portfolios increased by 3.5 per cent.

THE LETTING RATE was 93 per cent (94%), including project properties.

THE OPERATING SURPLUS from property management increased to SEK 1,458 million (SEK 1,450 m), an increase of 0.5 per cent. The increase is primarily the result of sold properties but also contributions from acquired properties, new lettings and renegotiations. The operating surplus margin is unchanged at 68 per cent (68%).

THE PROFIT BEFORE CHANGES IN VALUE increased to SEK 965 million (SEK 945 m).

THE UNREALISED CHANGE IN VALUE for properties increased to SEK 2,772 million (SEK 2,328 m) and is explained by the market’s lower yield require-ments and higher rents as a result of new lettings and renegotiations. Unrealised changes in the value of derivatives amounted to SEK –307 million (SEK 201 m) as market interest rates during the period declined on the terms covered by the derivatives.

THE NET PROFIT FOR THE YEAR totalled SEK 2,681 million (SEK 2,784 m), corresponding to SEK 20.13/share (SEK 20.89/share).

INVESTMENTS in Atrium Ljungberg’s own properties amounted to SEK 1,002 million (SEK 768 m).

ACQUISITION OF PROPERTIES amounted to SEK 1,461 million (SEK 872 m).

THE BOARD proposes a dividend of SEK 3.95/share (SEK 3.55/share).

THE 2017 PROFIT FORECAST before changes in value and tax is SEK 1,055 million.

INTERIM REPORT 1 JANUARY – 31 DECEMBER 2016

KEY RATIOS1)2016

Jan – Dec 2015

Jan – Dec2016

Oct – Dec2015

Oct – Dec

Net sales, SEK m 2,299 2,468 588 638

Profit/loss before changes in value, SEK m 965 945 228 227

Net profit/loss for the period, SEK m 2,681 2,784 1,582 1,272

Investments in Atrium Ljungberg’s own properties, SEK m

1,002

768

382

269

Acquisition of properties, SEK m 1,461 872 – –

Cash flow from operating activities, SEK m 949 1,006 247 230

Letting rate, % 93 94 93 94

Equity/assets ratio, % 43.7 43.7 43.7 43.7

Adjusted gearing ratio, % 41.9 43.0 41.9 43.0

Interest coverage ratio, multiple 3.5 3.3 3.5 3.2

Average interest rate at the period end, % 2.3 2.9 2.3 2.9

Earnings per share, SEK 20.13 20.89 11.72 8.25

Profit/loss before changes in value less nominal tax, SEK/share 5.65 5.54 1.34 1.33

Share price at period end, SEK/share 142.30 133.00 142.30 133.00

EPRA NNNAV, SEK/share 144.38 122.95 144.38 122.95

Shareholders’ equity, SEK/share 121.42 104.73 121.42 104.73

1) For definitions, see pages 22 and 23.

Contracted annual rent per premises type

Contracted annual rent per region

Retail 44 %,SEK 971 m

Offices 43 %, SEK 948 m

Residential 3 %, SEK 72 m

Other 10 %, SEK 217 m

Stockholm 77 %, SEK 1,700 m

Malmö 9 %, SEK 208 mGothenburg 3 %, SEK 62 m

Uppsala 11 %, SEK 237 m

SIGNIFICANT EVENTS DURING THE FOURTH QUARTER

Atrium Ljungberg concluded an agreement for acquisition of the property Fatburen 2 in Söder-hallarna, at Medborgarplatsen in Stockholm. The property houses a food hall, stores and offices with a total letting area of approximately 8,500 m2. The acquisition is conditional on a decision in the city council of the City of Stockholm.

An agreement was concluded with IBM Svenska AB for letting approximately 6,500 m2 of office space in the property Borgarfjord 3 in Kista – a property which was acquired in April 2016.

Atrium Ljungberg received the award “BREEAM project of the year” for the sustaina-bility work in Gränbystaden in Uppsala.

Monica Fallenius, new director of the business area Transaction and establishment and member of the company management was recruited.

Construction start of two residential projects in Gränbystaden, Gränby Entré buildings 2 and 3, with a total of approximately 130 apartments. In addition, reconstruction of Forumkvarteret in central Uppsala started.

This interim report has been prepared in Swedish and translated into English. In the event of any discrepancies between the Swedish and the translation, the former shall have precedence.

3Q4 2016 ATRIUM LJUNGBERG

CEO’S STATEMENT

strategy for our new residential initiative where the objective is to build approximately 300 apart-ments per year over the coming years. The great majority will be tenant-owned dwellings but we are of the opinion that it is also important to add rental dwellings to an area. The starting shot has been fired in Gränbystaden where we will construct a total of 450 rental and tenant-owned dwellings over the coming years close to Grän-bystaden shopping centre. Sickla is next in line.

NOTICEABLE SUSTAINABILITY WORK We have intensified our sustainability work with the aim of becoming the leader of sus-tainable urban development in the sector. Sustainability work is a natural part of our daily operations and is integrated into our strategies, where the housing initiative also is a key part. The work is appreciated by both tenants and municipalities. During the year we were also recognised through the award “BREEAM project of the year” for our sustain-ability work with Gränbystaden.

RESULTS AND FUTURE PROSPECTSWe are continuing to deliver stable results and exceed our forecast. A record-breaking property market with lower yield require-ments and several positive new lettings and renegotiations of lease contracts has contrib-uted to us appreciating the value of our prop-erties during 2016 by 9 per cent. Net letting amounted to SEK 128 million. We are delivering a slightly higher operat-ing surplus than last year but are still quite far from our growth target of 10 per cent. The reason is that in 2015 we made a large strate-gic sale of retail properties for approximately SEK 1.3 billion, which impacted the operating surplus for 2016. In addition, the investment rate during 2014 and 2015 has been lower than our target of SEK 1 billion per year. We are now increasing the pace by several pro-ject starts in 2017 with completion 2018–2019.

The acquisitions we conducted in 2016 will result in higher income for 2017. The forecast for profit before changes in value is SEK 1,055 million for 2017 in comparison to the result of SEK 965 million in 2016.

There is a lot to indicate that Sweden’s growth rate will be good in 2017 as well. Howev-er, irrespective of this we are a long-term player who has chosen to have strong key ratios. If the market slackens we have a strong balance sheet to rely on. Thus, irrespective of the econo-my we will be able to continue investment in new development projects.

PROJECT PORTFOLIO ACCELERATINGWe currently have an ongoing project portfolio with a remaining investment of just under SEK 2 billion. In 2017 we expect to start projects with a total investment volume of approximate-ly SEK 2 billion. The construction starts include retail, residentials and offices in both Gränby-staden and in Sickla as well as offices in Ha-gastaden. In addition to this, our project portfo-lio enables us to invest an additional SEK 9 billion within the land we own and the land al-locations which we possess. A significant pro-ject portfolio!

STRATEGY FOR RESIDENTIALS COMPLETEWe are continuing to create sustainable and vi-brant urban environments by combining differ-ent operations such as retail, culture, offices, service and education in the same place. For an urban environment to be vibrant, a supplement of residentials is an absolute necessity. There-fore, during the year we have developed a clear

“In 2017 we expect to start projects with a total investment volume of approximately SEK 2 billion. In addition to this, we have a significant project portfolio in which our new residential initiative is an important piece of the puzzle in order to build sustainable urban environments.”

SEVERAL IMPORTANT ACQUISITIONS During 2016 we conducted several important acquisitions with significant future opportuni-ties. By purchasing the second of the two prop-erties which comprise Söderhallarna in Stock-holm, we will own the entire Söderhallarna complex. There is vast potential here to further develop the food market and strengthen the cultural atmosphere at Medborgarplatsen. We now have good opportunities to create syner-gies, both in operation and in concept between both properties and develop the entire Söderh-allarna to an attractive meeting place. It fits in well with our strategy to build urban environ-ments with a mixed content in which we can af-fect the entirety. The deal was approved by the city council in February 2017. The acquisition of an office property worth one billion in Sundbyberg, the former choco-late factory, entails that we entered a new sub-sidiary market with vast growth potential. Sundbyberg is a dynamic municipality under-going strong development where the number of residents will increase significantly over the coming years. We hope for several business opportunities in Sundbyberg so that we can be a part of the municipality’s development in the future.

RATINGWe have recently received a rating from the credit rating agency Moody’s, which conducts an independent assessment of the company’s credit risk. We have been awarded the grade Baa2 with stable outlook, which entails in-vestment grade. In all likelihood this will fur-ther improve our opportunities to finance ourselves through the capital market at good conditions.

SWEDEN’S BEST WORKPLACEI am delighted that again in 2016 we were in-cluded in the list of Sweden’s best workplac-es. Our strong employer brand is also notice-able when we search for new employees. We get many good candidates and can recruit competent personnel who share our strong core values.

To conclude, I would like to express my deepest gratitude to our tenants and other stakeholders for good collaboration last year. I would also like to thank all employees for their strong drive and commitment which is important when we together are continuing to develop Atrium Ljungberg for the future!

Annica Ånäs, CEO

2016 was characterised by strong development and a high pace. We conducted several important acquisitions with significant future opportunities and over coming years we will further increase the investment rate. There is significant potential by means of our large project portfolio in which our new residential initiative is an important piece of the puzzle in order to build sustainable urban environments.

4 Q4 2016 ATRIUM LJUNGBERG

2016 2015 2016 2015Amounts in SEK m 1/1–31/12 1/1–31/12 1/10–31/12 1/10–31/12

Rental income 2,150 2,122 553 551Sales, project and construction work 149 346 35 87Net sales 2,299 2,468 588 638

Property management costs Service charge-related costs –176 –177 –48 –46 Other operating costs –154 –150 –45 –38 Management costs –148 –136 –58 –44 Repairs –50 –47 –18 –16 Property tax –130 –126 –34 –32 Leasehold fees –25 –26 –5 –6 Non-deductible VAT –10 –10 –3 –3

–692 –671 –211 –185

Project and construction work costs –162 –372 –35 –99

Gross profit/loss 1,445 1,425 342 354

– of which gross profit/loss property management (operating surplus) 1,458 1,450 342 366– of which gross profit/loss from project and construction work –12 –26 –1 –12

Central administration, property management –82 –60 –17 –21Central administration, project and construction work –15 –15 –5 –4

–97 –76 –22 –25

Financial income 1 2 0 0Financial expenses –385 –405 –92 –102

–384 –403 –92 –101

Profit/loss before changes in value 965 945 228 227

Changes in valueProperties, unrealised 2,772 2,328 1,483 928Properties, realised 6 –44 – –44Derivatives, unrealised –307 201 307 161

2,471 2,485 1,790 1,045

Profit/loss before tax 3,436 3,431 2,018 1,272

Current tax –4 –17 0 8Deferred tax –751 –630 –457 –180

–755 –647 –457 –173

Profit for the period 2,681 2,784 1,561 1,100

Other comprehensive incomeItems which will be reclassified to profit/lossCash flow hedging 19 25 5 5Tax attributable to other reported income and expenses –4 –5 –1 –1Total other comprehensive income 15 19 4 4

Total comprehensive income for the period 2,696 2,803 1,565 1,103

Earnings per share, SEK 20.13 20.89 11.72 8.25

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

5Q4 2016 ATRIUM LJUNGBERG 5

Omsättning, mkr

SEK m

Rental income Project and construction work

2014 2015 2016

0

100

200

300

400

500

600

700

Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1

Driftöverskott och överskottsgrad

SEK m %

2014 2015 2016

0

50

100

150

200

250

300

350

400

Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1

Operating surplus, SEK m Operating surplus margin, %

40

45

50

55

60

65

70

75

80

RESULTS JANUARY–DECEMBER 2016

NET SALESThe Group’s net sales for the year totalled SEK 2,299 million (SEK 2,468 m), of which rental income comprised SEK 2,150 million (SEK 2,122 m). Rental income increased by 3.5 per cent in compa-rable portfolios. Project and construction sales have declined com-pared to last year as a result of TL Bygg having lower external sales. During the year non-recurring remuneration of SEK 2 million (SEK 16 m) was received for premature vacating of premises.

RENTAL INCOME TREND2016

1/1–31/122015

1/1–31/12Change,

%Like-for-like 1,892 1,828 3.5

Non-recurring remuneration 2 16

Project properties 82 71

Properties acquired 173 95Properties sold – 112Rental income 2,150 2,122 1.3

At the end of the period the market value for the like-for-like portfo-lio was SEK 30,300 million (SEK 27,207 m).

PROPERTY COSTSProperty expenses totalled SEK –692 million (SEK –671 m). For the like-for-like portfolio, property expenses have increased by 2.8 per cent in comparison to the previous year.

PROPERTY COSTS TREND 2016

1/1–31/122015

1/1–31/12Change,

%Like-for-like –589 –573 2.8

Project properties –35 –27

Properties acquired –68 –29Properties sold 0 –43

Property management costs –692 –671 3.2

Sales Operating surplus and operating surplus margin

GROSS PROFIT/LOSSThe gross profit for the property management activities (the oper-ating surplus) increased to SEK 1,458 million (SEK 1,450 m), corre-sponding to 0.5 per cent. The increase is primarily the result of sold properties but also contributions from acquired properties, new lettings and renegotiations. During the fourth quarter the operating surplus has been charged with approximately SEK 10 million, of which the majority relates to compensation for delayed possession. The operating surplus margin is unchanged at 68 per cent (68%).

Contributions from acquired properties primarily relate to the properties Lundbyvassen 4:7 and Lundbyvassen 4:13 in Gothenburg which were taken into possession on 30 September 2015 and Borgar-fjord 3 in Kista which was taken into possession on 20 April 2016.

The gross profit for project and construction activities totalled SEK –12 million (SEK –26 m). Costs in connection with ongoing de-velopment projects that cannot be capitalised have been charged to profit/loss.

TL Bygg’s gross profit amounted to SEK 20 million (SEK 5 m). The results for last year were charged by acceleration costs in a construction contract that was carried out.

CENTRAL ADMINISTRATIONCentral administration comprises of costs for the company manage-ment as well as central support functions. The cost for the year amounted to SEK –97 million (SEK –76 m) and has been affected by costs in connection with changes in the company management as well as investments in certain central functions.

FINANCIAL INCOME AND EXPENSES Financial expenses for the year amounted to SEK –385 million (SEK –405 m), the expenses decreased despite higher interest-bearing liabilities. Financial income totalled SEK 1 million (SEK 2 m).

The average interest rate at the end of the year amounted to 2.3 per cent (2.9%). For more information, refer to the section on fi-nancing on page 12.

6 Q4 2016 ATRIUM LJUNGBERG6

CHANGES IN VALUEUnrealised changes in the value of properties totalled SEK 2,772 million (SEK 2,328 m), an increase by 19.1 per cent. For more infor-mation, refer to the section on the property portfolio on page 8.

Unrealised changes in the value of derivatives totalled SEK –307 million (SEK –201 m) as a result of lower market interest rates.

TAXESThe current tax for the period totalled SEK –4 million (SEK –17 m) and has been affected by, among other things, tax deductible de-preciation and investments, and by loss carry-forwards from the previous year’s tax assessment.

The change in deferred tax amounts to SEK –751 million (SEK –630 m) and has primarily been impacted by deferred tax on unre-alised changes in the value of properties.

At the end of the period the Group’s accumulated fiscal deficit is es-timated at SEK 130 million (SEK 196 m), of which SEK 101 million (SEK 136 m) comprises the base of the Group’s deferred tax receivable.

TAX CALCULATION, 31/12/2016

SEK m Current tax Deferred taxReported profit/loss before tax 3,436Tax deductible depreciation –559 559 investments –234 234 disposal of building – –Non-taxable/non-deductible changes in the value of properties, unrealised –2,772 2,772 changes in the value of properties, realised 9 –11 changes in the value of derivatives, unrealised 307 –307

goodwill write-downs – – consolidated capitalisation of borrowing –14 14Other fiscal adjustments 3 –12Taxable profit/loss before loss carry-forwards 176 3,249

Change in loss carry-forwards –167 156

Taxable profit/loss 9 3,405

Of which 22% current/deferred tax –2 –749Revaluation of previous tax assessments and other adjustments –2 –2

Reported tax expense –4 –751

RESULTSThe profit before changes in value increased to SEK 965 million (SEK 945 m).

Net profit for the period totalled SEK 2,681 million (SEK 2,784 m), which corresponds to SEK 20.13/share (SEK 20.89/share) and was primarily affected by unrealised changes in the value of derivatives.

PROFIT AND LOSS 1 OCTOBER–31 DECEMBERNet sales for the fourth quarter totalled SEK 588 million (SEK 638 m), of which rental income comprised SEK 553 million (SEK 511 m). Rental income has been impacted by additional rental income from acquired properties, new lettings and renegotiations, but also by the effect of sold properties. During the fourth quarter rental income has been impacted negatively by ongoing adaptation for occupancy or further extensions. During the fourth quarter no additional compensation for prema-ture vacating of premises was received (2). Property expenses to-talled SEK –211 million (SEK –185 m). During the fourth quarter the operating surplus has been charged with approximately SEK 10 mil-lion, of which the majority relates to compensation for delayed pos-session. Costs of central administration for the fourth quarter amounted to SEK –22 million (SEK –25 m). Financial expenses for the fourth quarter amounted to SEK –92 million (SEK –102 m). Unre-alised changes in the value of properties totalled SEK 1,483 million (SEK 928 m) and are primarily explained by the market’s lower yield requirements. Unrealised changes in the value of derivatives to-talled SEK 307 million (SEK 161 m) as a result of higher market in-terest rates for the periods covered by the derivatives. The current tax for the period totalled SEK 0 million (SEK 8 m). The profit before changes in value increased to SEK 228 million (SEK 227 m), corre-sponding to SEK 1.71/share (SEK 1.71/share).

NET LETTINGNet letting, i.e. newly agreed contracted annual rents less annual rents terminated due to clients vacating the premises, amounted to SEK 38 million (SEK –1 m) during the fourth quarter, and has primarily been impacted by a number of office lettings, among others to IBM Svenska AB for 6,500 m2 in Borgarfjord 3 in Kista. The time lag be-tween net letting and its effect on profit is assessed to be 6–9 months. During the year net letting totalled SEK 128 million (SEK 62 m), of which SEK 28 million (SEK 36 m) referred to project properties.

PROFIT FORECASTThe forecast profit before changes in value and tax for 2017 is SEK 1,055 million. The forecast profit after tax is SEK 822 million, corresponding to SEK 6.17/share. The forecast includes the property Fatburen 2. Future changes in value and any other future property acquisitions and sales of properties have not been taken into account in the forecast.

RENTAL VALUE AND LETTING RATE31/12/2016 31/12/2015

Premises typeRental value,

SEK mRental value,

SEK/m2 Letting rate,

%Rental value,

SEK mRental value,

SEK/m2Letting rate,

%Office 979 2,422 90 877 2,410 91Retail 955 3,201 96 948 3,110 97Other 214 1,877 96 214 1,874 90Residentials 71 1,327 98 71 1,313 100Garage 62 – 98 52 – 91Business area Property 2,280 2,622 93 2,162 2,582 94Project properties 94 1,755 88 30 1,074 97Land and development rights – – – – – –Total 2,374 2,572 93 2,192 2,534 94

7Q4 2016 ATRIUM LJUNGBERG

CONSOLIDATED BALANCE SHEETS SUMMARY

Amounts in SEK m 31/12/2016 31/12/2015 30/09/2016 30/09/2015

ASSETSInvestment properties 36,054 30,841 34,195 30,936Goodwill 263 263 263 274Other fixed assets 52 48 41 45Total fixed assets 36,368 31,152 34,499 31,255

Current assets 357 405 586 486Liquid assets 276 389 255 59Total current assets 633 795 841 545

Total assets 37,001 31,947 35,340 31,800

TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIESShareholders’ equity 16,176 13,953 14,612 12,849

Deferred tax liability 4,010 3,275 3,545 3,129Long-term interest-bearing liabilities 13,125 10,976 11,796 11,357Derivatives 900 621 1,207 786Other long-term liabilities 60 32 52 31Total long-term liabilities 18,095 14,905 16,601 15,303

Short-term interest-bearing liabilities 1,970 2,285 3,150 2,738Derivatives 9 0 13 1Other current liabilities 751 804 964 909Total current liabilities 2,730 3,090 4,127 3,648

Total shareholders’ equity and liabilities 37,001 31,947 35,340 31,800

Attributable to the Parent Company shareholders

Amounts in SEK m Share capitalOther capital

contributedHedging reserves

Profits brought forward

Total share- holders’ equity

Opening balance as per 1 January 2015 333 3,960 –88 7,385 11,590Profit for the period 2,784 2,784Other comprehensive income 19 19Dividend, SEK 3.30/share –440 –440Closing balance, as per 31 December 2015 333 3,960 –69 9,729 13,953

Change in shareholders’ equity, 2016 333 3,960 –69 9,729 13,953Profit for the period 2,681 2,681Other comprehensive income 15 15Dividend, SEK 3.55/share –473 –473Closing balance, as per 31 December 2016 333 3,960 –54 11,937 16,176

There are a total of 133,220,736 (133,220,736) shares, of which 4,000,000 (4,000,000) are class A shares and 129,220,736 (129,220,736) are class B shares. One class A share grants entitlement to ten votes and one class B share grants entitlement to one vote. At the end of the period, the number of outstanding shares amounted to 133,220,736 (133,220,736 as of 31/12/2015). The average number of outstanding shares for the period 01/01/2016 – 31/12/2016 amounts to 133,220,736 (133 220 736).

CONSOLIDATED CHANGES IN SHAREHOLDERS’ EQUITY

8 Q4 2016 ATRIUM LJUNGBERG

PROPERTY PORTFOLIOTHE PROPERTY MARKETThe Swedish property market continues to be strong with low vacan-cies and higher market rents. Continued large interest in property investments as a result of the low yield for other assets has resulted in that the market’s yield requirements have continued to decline.

According to Savills, the transaction volume in the Swedish property market during 2016 amounted to a record level of SEK 201 billion, 23 per cent higher than the top quotation of 2014.

OUR PROPERTY PORTFOLIOAtrium Ljungberg’s property portfolio consists of 50 properties locat-ed in Stockholm, Uppsala, Malmö and Gothenburg. Our portfolio, which mainly consists of retail and office properties, is made up of modern, attractive properties with a total letting area of 1,124,000 m2. In March the office and health care property Malmen 12 in central Malmö was acquired, totalling approximately 7,500 m2 of letting area. The acquisition took place through a share deal with an underlying property value of SEK 125 million. Possession took place in May. In April, the office property Borgarfjord 3 was acquired and tak-en into possession. It is located in Kista with 13,500 m2 of letting area. The acquisition took place through a share deal with an un-derlying property value of SEK 325 million. In July, the office property Eken 6 was acquired, located in Sund-byberg with 28,500 m2 of letting area. The acquisition took place through a share deal with an underlying property value of SEK 1,059 million. Possession took place in September. In November an agreement was concluded on acquiring Fatbu-ren 2, Söderhallarna in Stockholm. The acquisition is conditional on a decision in the city council and is therefor not included in the accounts.

CONTRACTED ANNUAL RENT AND LETTING RATEThe contracted annual rent at the turn of the year totalled SEK 2,208 million (SEK 2,054 m) and the rental value amounted to SEK 2,374 million (SEK 2,192 m). This gives a letting rate including pro-ject properties of 93 per cent (94%) and excluding project properties of 93 per cent (94). The EPRA vacancy rate is thus 7 per cent (6%).

The commercial lease contract portfolio is well-diversified and comprises 1,865 lease contracts (1,771), excluding residentials and

garage/parking. The average remaining term at the turn of the year was 3.7 years (3.4 years). The ten largest tenants comprise 21 per cent of the contracted annual rent.

During 2017, 11 per cent (21%) of the contracted annual rents will be subject to renegotiation. 94 per cent of contracted annual rent is regulated with an index clause linked to inflation. 28 per cent (29%) of the contracted annual rent has a sales-based rent where rent is regulated based on the tenant’s sales. The rental lev-els have primarily been secured through agreed minimum rents and sales premium in addition to the minimum rent and comprise 1 per cent (1%) of the contracted annual rent.

PROPERTY PORTFOLIO, 31/12/2016

Result January–December 2016 1)

Property typeLetting area,

'000 m²Fair value,

SEK mFair value,

SEK/m²2)Rental in-

come, SEK mProperty costs,

SEK mOperating sur-

plus, SEK mOperating sur-plus margin, %

Office properties 584 17,716 37,247 1,021 –293 728 71

Retail properties 415 14,400 43,006 963 –334 629 65

Residential properties 71 1,390 23,530 84 –30 53 64Business area Property 1,070 33,506 38,533 2,068 –657 1,410 68Project properties 54 1,846 N/A3) 82 –35 48 58Land and development rights – 702 – – – – –Total 1,124 36,054 2,150 –692 1,458 68Properties sold – 0 – –Total Group 2,150 –692 1,458 681) Refers to reported result during the year. 2) m2 excluding garage. 3) Letting area for new production is not reported until the project is completed and the figures hence do not accurately represent the actual situation.

Ten largest customers, contracted annual rent

Contracted annual rent per maturity year and premises type

Atlas CopcoIca

H&M

Telenor

AxfoodOther 79 %

ÅhlénsStockholms municipality

Nacka municipalityCoop

Stockholm County Council

0

100

200

300

400

500

202220212020201920182017

Retail Office Other

Gar

age

Res

iden

tial

and there-after

SEK m

9Q4 2016 ATRIUM LJUNGBERG

Changes in the property portfolio

SEK m2016

1/1–31/122015

1/1–31/12Fair value at the start of the period 30,841 28,163Acquisitions (after deduction of deferred tax) 1,461 872Sale –23 –1,291Investments in our own properties 1,002 768Unrealised changes in value 2,772 2,328Fair value at the end of the period 36,054 30,841

PROPERTY VALUESDuring 2016 we externally valued the equivalent of 44 per cent of the property portfolio's market value, of which 20 per cent was conducted during the fourth quarter. The valuations were carried out by Forum Fastighetsekonomi and Savills in accordance with the International Valuation Standards (IVS). The remaining properties were subject to an internal valuation with market rents, operating costs, vacancies and yield requirements quality assured by Forum Fastighetsekonomi.

The market valuation is based on analyses of completed proper-ty transactions for properties of a similar standard and in a similar location, in order to assess the market’s yield requirements. The valuation also entails cash flow calculations, with individual as-sessments of the earning capacity of each individual property. As-sumed rental levels in conjunction with contract expirations corre-spond to current market rent levels. Operating costs have been assessed on the basis of the company’s actual costs. Development rights have been valued based on an assessed market value per m2 of GFA for determined development rights in accordance with an approved detailed development plan or where the detailed develop-ment plan is assessed to enter into force within the near future. Project properties are valued on the basis of completed projects, less remaining investments. A risk surcharge is added to the yield requirement on the basis of the current phase of the project.

The unrealised change in value during the period amounted to SEK 2,772 million (SEK 2,328 m) and is explained by the market’s lower yield requirements and higher rents as a result of new let-tings and renegotiations. Development rights have increased by SEK 334 million (–), largely due to several residential development rights assessed as entering into force within the near future.

Unrealised changes in value, properties

SEK m 31/12/2016 31/12/2015Change in yield requirements 1,799 2,139

Change in operating net etc. 639 189

Development rights 334 –

Total 2,772 2,328

Dividend yield requirement per premises type

%31/12/2016 31/12/2015

Interval Average AverageOffice 3.8–6.5 4.8 5.2Retail 3.8–6.3 5.0 5.2Residentials 3.0–3.8 3.2 3.7Other 3.8–6.3 5.2 5.5Total 3.0–6.5 4.9 5.2

Dividend yield requirement per region

%31/12/2016 31/12/2015

Interval Average AverageStockholm 3.0–6.3 4.8 5.1Uppsala 3.5–6.5 5.3 5.6Malmö 3.8–6.3 5.5 5.7Gothenburg 4.8–5.3 4.8 5.3Total 3.0–6.5 4.9 5.2

PROPERTY PORTFOLIO, 31/12/2015

Result January–December 2015 1)

Property typeLetting area,

'000 m²Fair value,

SEK mFair value,

SEK/m²2)Rental in-

come, SEK mProperty costs,

SEK mOperating sur-

plus, SEK mOperating sur-plus margin, %

Office properties 505 14,323 33,497 939 –258 681 73

Retail properties 431 14,146 40,324 971 –330 640 66

Residential properties 71 1,223 20,688 76 –31 45 59Business area Property 1,007 29,692 35,450 1,986 –619 1,367 69Project properties 28 843 E/T3) 24 –10 14 58Land and development rights – 307 – – – – –Total 1,034 30,841 2,010 –629 1,381 69Properties sold 112 –43 69 62Total Group 2,122 –671 1,450 681) Refers to reported result during the year.2) m2 excluding garage. 3) Letting area for new production is not reported until the project is completed and the figures hence do not accurately represent the actual situation.

SEK m

0

500

1,000

1,500

2,000

2,500

3,000

20162015201420132012

Changes i value, properties (unrealised and realised)

0.6%

8.2%

9.0%

1.8%

3.5%

Changes in value, properties

10 Q4 2016 ATRIUM LJUNGBERG

ONGOING PROJECTS

Project, property Mun

icip

ality

Lett

ing

area

, R

etai

l, m

²

Lett

ing

area

, O

ffice

, m²

Lett

ing

area

, R

esid

entia

ls, m

2

Park

ing,

GFA

Tota

l in

vest

men

t, SE

K m

Of w

hich

re

mai

ning

, SE

K m

Com

plet

ed

Fair

val

ue,

SEK

m

Ren

tal v

alue

, SE

K m

1)

Lett

ing

rate

, %

Envi

ronm

enta

l ce

rtifi

catio

nNew builds and extensions

Sickla Front II, Sicklaön 346:1 Nacka 25,000 14,000 830 570 2018 63 N/A2) BREEAM

Northern Gränbystaden, Brillinge 8:1/9:1 Uppsala 31,000 590 190 2014–2018,3) 50 80 BREEAM

Gränby Entré building 1, Gränby 21:4, Uppsala 2,700 3,100 220 150 2017 16 624) Environmental Building

Gränby Entré building 2, Gränby 21:4, Uppsala 900 1,300 3,300 220 210 2018 14 165) Environmental Building

Gränby Entré building 3, Gränby 21:4, Uppsala 1,100 1,300 3,400 240 230 2019 15 0 Environmental Building

Gränbystaden, south garage, Gränby 21:4 Uppsala 11,000 180 130 2017 6) BREEAM In-Use7)

Reconstruction

Forumkvarteret8) Uppsala 8,100 2,600 1,400 260 210 2018 558 37 369) 7)

Total ongoing projects 43,800 30,200 11,200 25,000 2,540 1,690 1,522 195

Other project properties 324

Total project properties 1,846

1) Excluding premiums and any net sales result.2) Letting rate not reported as a subtotal with regard to individual business transactions.3) Covers approximately 45,000 m2 GFA in total. Investment decisions and completion take place in stages, among other things, connected to letting.4) The letting rate for commercial premises amounts to 99%. Residentials are leased closer to completion.5) The letting rate for commercial premises amounts to 31%. Residentials are leased closer to completion.6) The garage will be used as a free of charge guest parking.7) The entire property will be certified in accordance with BREEAM In-Use.8) The investment is partially conditional on letting.9) Lease contract terminated for renegotiation not included in letting rate.

ONGOING PROJECTSIn 2016, we invested SEK 1,002 million in our own properties, of which SEK 509 million was in project properties. The investments in project properties mainly refer to Northern Gränbystaden and Sickla Front II. Other investments primarily refer to major inter-nal renovation of the Gränbystaden shopping centre and Mobilia, as well as tenant-specific adaptations in our properties in Gothen-burg, Liljeholmen and Hagastaden. The remaining investment vol-ume for ongoing project properties amounted to approximately SEK 1,690 million at the turn of the year.

SICKLA FRONT II – STOCKHOLMThe construction of two office buildings and a parking garage on Ud-dvägen in Sickla is proceeding according to plan. Here we are creat-ing an urban district for large and small office businesses which links together Hammarby Sjöstad with Sickla. On the ground floor we are planning for public activities such as restaurants and a gym. The extension of Tvärbanan cross-town light rail link, which will be put into service during the second half of 2017, will run past our new district on the way to nearby Sickla station. The project Sickla Front II covers approximately 25,000 m2 of let-ting office area in total and 14,000 m2 GFA for parking. Occupancy by the Swedish National Courts Administration, which will become a significant tenant in one of the new buildings, is expected to take place during the second quarter of 2018.

GRÄNBYSTADEN – UPPSALAOur long-term work with Gränbystaden is continuing with full in-tensity. New builds and extensions are continuing at both Gränby-staden’s northern area alongside the E4 and by Gränbystaden Gal-leria (formerly Gränby Centrum). In Northern Gränbystaden we completed three buildings for stores, restaurants and activities during the second quarter of 2016 and at the end of 2016 and start of 2017 we commenced the construction of two more buildings in the area. Among other businesses, Elon will open here during the autumn of 2017 and Jula, Jysk and Rusta during the au-tumn of 2018. When these two projects have been completed, Northern Gränbystaden will cover a total letting area of 31,000 m2.

Gränby Entré buildings 1, 2 and 3 – Construction of two residential buildings with approximately 60 and 70 rental apartments respectively

as well as business premises on the bottom floor is taking place close to Gränbystaden Galleria. Occupancy is expected to take place during the autumn of 2017 and by the turn of the year 2018/2019. The buildings will be certified in accordance with the Environmental Building level silver.

It has also been decided to construct a third residential building with roughly 70 more rental apartments with occupancy in the first quarter of 2019.

Gränbystaden, south garage – Next to Gränbystaden shopping centre, construction is ongoing of a parking garage with approxi-mately 300 underground parking spaces. The garage is expected to be completed in 2018.

FORUMKVARTERET – UPPSALAWe are managing major transformation work in Forumkvarteret in central Uppsala. Our aim for the district, which contains retail in the form of Forumgallerian as well as office premises and residentials, is to create a city centre district with a strong retail range combined with attractive office environments and residentials. In 2016 improvements to office premises and rental apartments were made and currently re-construction of the shopping centre is being conducted. Among other things, we are making space available and creating a clear internal concourse through the shopping centre. The ongoing projects in Fo-rumkvarteret are expected to be completed during the autumn of 2018.

POTENTIAL DEVELOPMENT PROJECTSOur existing project portfolio with future projects enables invest-ments corresponding to approximately SEK 11 billion. The increase in investment volume can be attributed to additional project areas as well as changed assumptions on investment costs. In terms of area, half of our project portfolio consists of residen-tials and half of offices, retail, education and hotel. The project port-folio is divided among all our areas where Sickla and Uppsala ac-count for approximately 70 per cent. The rate at which we can complete the projects depends on the market situation and the pro-gress made in the detailed development plan process.

POTENTIAL PROJECT STARTS 2017–2018We are planning several project starts during 2017–2018 which are covered by current detailed development plans and others depend on new detailed development plans.

11Q4 2016 ATRIUM LJUNGBERG

Residentials 50 %

Office 22 %

Education 8 %

Retail 17 %

Hotels 3 %

Sickla 51 %

Gränbystaden 18 %

Hagastaden 8 %

Barkarby 12 %

Other 11 %

POTENTIAL DEVELOPMENT PROJECTSProject area, m², GFA

Municipality Premises type 1)Detailed development

plan existsChange to detailed develop-

ment plan required Inv., SEK m 2)

Barkarby 3) Järfälla Education 26,000Barkarby 3) Järfälla Residentials 11,000Barkarby 3) Järfälla Office 13,000Farsta Centrum Stockholm Retail 5,000Forumgallerian Uppsala Residentials 3,000Gränbystaden Galleria Uppsala Retail 10,000 27,000Gränbystaden Galleria Uppsala Residentials 34,000Hagastaden 4) Stockholm Retail 1,000Hagastaden 5) Stockholm Office 32,000Mobilia Malmö Retail 11,000Mobilia Malmö Residentials 5,500Northern Gränbystaden Uppsala Retail 5,000Port 73 Haninge Retail 8,000Sickla Nacka Office 22,000 11,000Sickla Nacka Retail 3,000 3,000Sickla Nacka Residentials 161,000Sickla Nacka Hotels 12,000Sickla Nacka Education 9,000Södermalm 6) Stockholm Office 17,000Total 165,500 264,000 11,0001) Anticipated premises use may change and may include other elements.2) The investment volume includes possible land acquisition. 3) Refers to a land allocation with the option of acquiring land with a development right of approximately 50,000 m² GFA in Barkarbystaden. 4) Refers to a land allocation with the option of leasing land with a development right of approximately 30,000m² GFA alongside Solnavägen (part of the Vasastaden 1:45 property).5) Refers to a land allocation with the option of transferring land with development rights of approximately 1,000 m2 GFA alongside Norra Stationsgatan.6) Refers to a land allocation with the option of acquiring land with development rights of approximately 16,000–18,000 m2 GFA on Stadsgårdsleden in front of Glashuset.

Potential projects by premises type, m2 Potential projects by location, m2

In Sickla we expect to start extension of an old office property in 2017 for 12,000 m2 GFA for hotel and offices as well as a garage. We are planning to start reconstruction and extension by Järnvägsgatan of 14,500 m2 of GFA for retail and health care operations by the end of 2017. Both projects are covered by current detailed development plans.

In Sickla Galleria we are planning for an extension of approxi-mately 3,000 m2 GFA for retail and two floors for a parking garage with approximately 220 parking spaces. A new detailed develop-ment plan is expected to enter into force during 2017. In addition, detailed development plans are ongoing for residen-tials at Nobelberget, Kyrkviken and Gillevägen where we expect a complete detailed development plan for Nobelberget by the turn of the year 2017/2018. Detailed development plans are also ongoing for reconstruction and extension of the school Svindersviksskolan from the current 3,000 m2 to approximately 9,000 m2 GFA.

In Gränbystaden we want to create Uppsala’s second city cen-tre. In the northern part a retail area of 50,000 m2 GFA is being cre-ated to supplement the shopping centre’s offering. There is a com-plete detailed development plan and development is taking place in line with the letting work. Next to the galleria we are also planning for approximately 250 tenant-owned dwellings by the adjacent Gränbyparken. Construction of the first phase of tenant-owned dwellings is expected to take place in 2019.

We are also planning for a major reconstruction and extension project by the gallerias’s southern area. The project covers 11,700

m2 for retail, restaurants, culture and entertainment and is expected to start in 2017. In addition, detailed development plans are ongoing for the area just north of the galleria which can enable the development of addi-tional 27,000 m2 GFA for retail and 30,000 m2 GFA for parking.

In Hagastaden, in the centre of the emerging life science cluster, we have a land allocation with a development right of 32,000 m² GFA. Here, above the E4, we are planning to build Life City, a complete district for businesses, academia and society. Construction is expected to start at the end of 2017 with planned occupancy during the autumn of 2020.

In Mobilia in Malmö our aim is to create new construction and extension of approximately 16,500 m2 GFA for retail, residentials and cultural activities in the heart of the district as well as several restaurants in towards Mobilia’s square. The project is covered by current detailed development plans and construction is expected to start around the turn of the year 2017/2018.

In Barkarby in Järfälla, together with Järfälla municipality, work is ongoing to create BAS Barkarby, a regional meeting place for learning, businesses and culture. The detailed development plan for the area is expected to be adopted by the end of 2017. A deci-sion on environmental permits is expected to be made in the sum-mer of 2018 by the Land and Environmental Court. Construction of the first phase of BAS Barkarby is expected to start by the summer of 2018 at the earliest, with occupancy in the spring of 2021.

12 Q4 2016 ATRIUM LJUNGBERG

THE FINANCIAL MARKETRecovery of the global economy continues to be sluggish. The slug-gishness contributes to inflation in large parts of Europe being low-er than the inflation target over coming years, which indicates that the European central banks will continue with a low-interest policy.

The Swedish economy is continuing to develop positively. The pri-mary driving force is strong private consumption and higher invest-ments, among other things through increasing housing construc-tion. The National Institute of Economic Research predicts continued growth where exports and household consumption are the key drivers of growth. The GDP growth forecast of the National Institute of Economic Research for 2016 is 3.4 per cent, which indi-cates good continued growth. The forecast for 2017 is 2.2 per cent.

The variable interest rate, 3M Stibor, remains at a low level and was –0.59 per cent at the turn of the year, which is a decline by 0.30 percentage points during the year. The long-term interest rate in-creased during the fourth quarter after falling to the lowest level during August. The 10 year swap interest rate was 1.10 per cent at the turn of the year.

INTEREST-BEARING LIABILITIESAtrium Ljungberg meets its financing requirements through five Nordic banks and the capital market. The banks are Atrium Ljungberg’s biggest financiers, and bank loans accounted for 58 per cent of the total loan volume at the turn of the year. Inter-est-bearing liabilities at the end of the period amounted to SEK 15,095 million (SEK 13,261 m). During the fourth quarter, liabilities increased by SEK 148 million, which is primarily related to invest-ments in Atrium Ljungberg’s own properties. At period end, the average interest rate amounted to 2.3 per cent (2.9%). Including unutilised loan guarantees the average inter-est rate amounted to 2.4 per cent (2.9%). Unutilised loan guaran-tees in addition to loan guarantees which cover outstanding com-mercial papers amounted to SEK 550 million (SEK 650 m). The unutilised overdraft facility amounted to SEK 300 million (SEK 300 m). The average fixed interest term was 3.9 years (4.4 years) and the capital commitment term was 3.5 years (3.1 years). COLLATERALOur borrowing is largely secured by real estate mortgages. Of the interest-bearing liabilities, SEK 8,697 million (SEK 9,469 m) is se-cured by mortgage deeds and SEK 6,390 million (SEK 3,792) is un-secured.

DERIVATIVESAt the end of the period, the derivative portfolio comprised of SEK 9,125 million (SEK 8,411 m) in interest swaps, with maturity be-tween the years 2017–2029. In addition, there is SEK 900 million in forward-started swaps starting in 2017. The derivatives portfolio is valued at market rate in conjunction with every closing of the ac-counts and the change in value is reported via the Profit and Loss Statement. During final maturity, a derivative contract’s market val-ue has been entirely dissolved and the change in value over time has thereby not impacted shareholders’ equity. The unrealised change in the value of derivatives during the period totalled SEK –307 million (SEK 201 m) as market interest rates have fallen on the terms covered by the derivatives during the period. The deficit book value of the derivatives portfolio totalled SEK –909 million (SEK –621 m) at the end of the period.

FIXED INTEREST

Fixed interest termAmount,

SEK m Percentage,

%Average interest,

% 1)

2017 6,600 44 0.92018 949 6 3.32019 – – –2020 600 4 4.32021 760 5 4.32022 and thereafter 6,186 41 3.5Total 15,095 100 2.31) The average credit margin for variable interest rates is spread over the time segment during

which the derivative falls due for payment. The average interest is reported excluding the cost of unutilised loan guarantees.

Capital commitment

Maturity date Amount, SEK m Percentage, %2017 1,960 13

2018 3,197 212019 3,520 232020 1,779 122021 1,019 72022 and thereafter 3,621 24Total 15,095 100

Key ratios financing

31/12/2016 31/12/2015Interest-bearing liabilities, SEK m 15,095 13,261Shareholders’ equity, SEK m 16,176 13,953Gearing ratio, % 41.9 43.0Adjusted gearing ratio, % 41.9 43.0Average fixed interest term, years 3.9 4.4Average capital commitment term, years 3.5 3.1Average interest rate for interest-bearing liabilities, % 2.3 2.9

Capital structure

Shareholders’ equity 44 %, 16 176 mkr

Unsecured loans 17 %, 6,399 mkr

Deferred tax liability 11 %, 4,010 mkr

Secured loans 23 %, 8,697 mkr

Other liabilities 5 %, 1,720 mkr

Interest-bearing liabilities

Bank loans 58%, SEK 8,697 mBonds 16 %, SEK 2,450 m

Commercial paper26 %, SEK 3,949 m

FINANCING

13Q4 2016 ATRIUM LJUNGBERG 13

CONSOLIDATED STATEMENTS OF CASH FLOW

COMMENTS ON THE CASH FLOW STATEMENTThe cash flow from operating activities totalled SEK 949 million (SEK 1,006 m), corresponding to SEK 7.06/share (SEK 7.55/share). The lower cash flow during the period compared to the same period last year is mainly explained by a lower change in operating capital. SEK –2,435 million (SEK –1,535 m) in investment activities has been charged to the cash flow and refers to acquisitions of proper-ties and investments in Atrium Ljungberg’s own properties.

The cash flow within financing activities amounted to SEK 1,373 million (SEK 504 m) due to net borrowing and dividend paid. Available liquidity amounted to SEK 1,126 million (SEK 1,339 m) and comprised bank deposits of SEK 276 million (SEK 389 m), unu-tilised overdraft facilities of SEK 300 million (SEK 300 m) and unuti-lised lines of credit of SEK 550 million (SEK 650 m) in addition to credit facilities covering outstanding commercial papers.

2016 2015 2016 2015Amounts in SEK m 1/1–31/12 1/1–31/12 1/10–31/12 1/10–31/12OPERATING ACTIVITIESProfit/loss before tax 3,436 3,431 2,018 1,272Reversal of depreciation and write-downs 6 8 2 2Realised changes in value, investment properties –6 33 – 33Unrealised changes in value, investment properties –2,772 –2,328 –1,483 –928Unrealised changes in value, derivatives 307 –201 –306 –161Other items not included in the cash flow 6 17 1 9Tax paid –35 –22 –8 1Cash flow from operating activities before changes in working capital 941 938 223 228

Net change in working capital 8 68 25 2Cash flow from operating activities 949 1,006 247 230

INVESTMENT ACTIVITIESAcquisition of properties –1,461 –1,958 6 –Reconstruction and new construction of properties –1,002 –769 –382 –269Sale of properties 36 1,201 – 1,201Purchase/sale of equipment –8 –9 –5 –2Cash flow from investment activities –2,435 –1,535 –381 930

FINANCING ACTIVITIESChange in other long-term liabilities 16 5 8 1Loans raised 5,090 3,811 298 200Amortisation of debts –3,260 –2,873 –150 –1,031Dividends paid –473 –440 – –Cash flow from financing activities 1,373 504 155 –830

Cash flow for the period –113 –25 21 331Liquid assets at the beginning of the period 389 415 255 59Liquid assets at the end of the period 276 389 276 389

14 Q4 2016 ATRIUM LJUNGBERG14

SEGMENT REPORTING 1/1–31/12 2016

Amounts in SEK m Bus

ines

s ar

ea

Prop

erty

Proj

ect

prop

ertie

s1)

Prop

ertie

s so

ld

Prop

erty

man

-ag

emen

t, to

tal

Proj

ect

deve

lopm

ent 2)

TL B

ygg

Proj

ect a

nd

cons

truc

tion

activ

ities

, tot

al

Non

-allo

cate

d ite

ms

and

elim

inat

ions

The

Gro

up

Rental income 2,078 82 0 2,160 –10 2,150Sales, project and construction work 28 435 463 –314 149Net sales 2,078 82 0 2,160 28 435 463 –324 2,299Property management costs –665 –33 0 –698 6 –692Project and construction work costs –63 –415 –478 317 –162Gross profit/loss 1,413 49 0 1,462 –35 20 –15 –2 1,445

– of which gross profit/loss from property manage-ment 1,413 49 0 1,462 –4 1,458– of which gross profit/loss from project and

construction work –35 20 –15 –3 –12

Central administration, property management –83 1 –82Central administration, project and construction work –16 –16 1 –15

Financial income 1 1Financial expenses –385 –385Profit/loss before changes in value 1,413 49 0 1,380 –35 4 –31 –384 965

Properties, unrealised changes in value 2,445 327 2,772 2,772Properties, realised changes in value 6 6 6Derivatives, unrealised changes in value –307 –307

Current tax –4 –4Deferred tax –751 –751Profit for the period 3,858 376 6 4,158 –35 4 –31 –1,446 2,682

Investments and acquisitionsInvestments, investment properties 493 509 1,002 1,002Investments, project and construction workAcquisitions, investment properties 1,461 1,461 1,461Total investments 1,954 509 2,463 2,463

Assets, period endInvestment properties 33,506 2,548 36,054 36,054Other assets 104 104 843 947Total assets 33,506 2,548 36,054 104 104 843 37,001

1) Including land and development rights2) The profit within Project development mainly refers to costs of investigations in early project stages and ongoing development projects.

Atrium Ljungberg’s segmentation is based on two business areas: Property management and Project and construction activities. As of Q2 2016, the business area Property management is divided into

Business area Property and Project properties. Project and con-struction activities are divided into Project development and TL Bygg.

15Q4 2016 ATRIUM LJUNGBERG 15

SEGMENT REPORTING 1/1–31/12 20151)

Amounts in SEK m Bus

ines

s ar

ea

Prop

erty

Proj

ect

prop

ertie

s2)

Prop

ertie

s so

ld

3) Prop

erty

man

-ag

emen

t, to

tal

Proj

ect

deve

lopm

ent 4)

TL B

ygg

Proj

ect a

nd

cons

truc

tion

activ

ities

, tot

al

Non

-allo

cate

d ite

ms

and

elim

inat

ions

The

Gro

up

Rental income 1,996 24 112 2,132 –10 2,122Sales, project and construction work 38 472 510 –164 346Net sales 1,996 24 112 2,132 38 472 510 –174 2,468Property management costs –624 –10 –43 –677 6 –671Project and construction work costs –69 –470 –539 167 –372Gross profit/loss 1,372 14 69 1,455 –31 2 –29 –1 1,425

– of which gross profit/loss from property manage-ment 1,372 14 69 1,455 –4 1,450– of which gross profit/loss from project and

construction work –31 2 –29 3 –26

Central administration, property management –61 1 –60Central administration, project and construction work –16 –16 1 –15

Financial income 2 2Financial expenses –405 –405Profit/loss before changes in value 1,372 14 69 1,394 –31 –14 –45 –403 945

Properties, unrealised changes in value 2,310 19 2,329 2,329Properties, realised changes in value –44 –44 –44Derivatives, unrealised changes in value 201 201

Current tax –17 –17Deferred tax –630 –630Profit for the period 3,682 33 25 3,679 –31 –14 –45 –849 2,784

Investments and acquisitionsInvestments, investment properties 550 219 768 768Investments, project and construction work 1 1 1Acquisitions, investment properties 872 872 872Total investments 1,422 219 1,640 1,641

Assets, period endInvestment properties 29,692 1,150 30,841 30,841Other assets 171 171 935 1,106Total assets 29,692 1,150 30,841 171 171 935 31,947

1) Segment reporting has been recalculated taking into account the merger of previous Business area Retail and Business area Offices.2) Including land and development rights3) The gross profit in the segment reporting 1/1–30/6 2015 has been adjusted for sold properties in the fourth quarter of 2015.4) The profit within Project development mainly refers to costs of investigations in early project stages and ongoing development projects.

16 Q4 2016 ATRIUM LJUNGBERG16

KEY RATIOS2016 2015 2016 2015

PROPERTY-RELATED KEY RATIOS 1/1–31/12 1/1–31/12 1/10–31/12 1/10–31/12Letting rate, % 93 94 93 94Operating surplus margin, % 68 68 62 67Letting area, ‘000 m² 1,124 1,034 1,124 1,110Investments in properties, SEK m 1,002 768 382 268Number of properties (period end) 50 48 50 48

FINANCIAL KEY RATIOS 2) 3)

Equity/assets ratio, % 43.7 43.7 43.7 43.7Gearing ratio % 41.9 43.0 41.9 43.0Adjusted gearing ratio, % 41.9 43.0 41.9 43.0Interest coverage ratio, multiple 3.5 3.3 3.5 3.2Average interest rate for interest-bearing liabilities, % 2.3 2.9 2.3 2.9Return on shareholders’ equity, % 17.8 21.8 40.6 32.8Return on shareholders’ equity, excluding changes in value, % 5.8 6.3 4.9 5.7Return on total assets, % 11.1 12.5 23.3 17.2Return on total assets excluding changes in value, % 4.2 4.6 3.6 4.3

DATA PER SHARE Earnings per share, SEK 20.13 20.89 11.72 8.25Profit/loss before changes in value less applicable nominal tax, SEK 5.65 5.54 1.34 1.33EPRA EPS, SEK 6.96 6.91 1.73 1.75Cash flow, SEK 7.12 7.55 1.85 1.73Shareholders’ equity, SEK 121.42 104.73 121.42 104.73EPRA NAV, SEK 156.21 131.78 156.21 131.78EPRA NNNAV, SEK 1) 144.38 122.95 144.38 122.95Share price at period end, SEK 142.30 133.00 142.30 133.00Average number of outstanding shares, ‘000 133,221 133,221 133,221 133,221Number of outstanding shares at end of period, thousand 133,221 133,221 133,221 133,221

EMPLOYEESAverage number of employees 281 282 280 282

1) For calculation of EPRA NNNAV, an estimated deferred tax of 4.0 per cent has been used for properties.2) See reconciliation for key ratios on Atrium Ljungberg’s website.3) For definitions, see pages 22 and 23.

EPRA KEY RATIOS31/12/2016 31/12/2015

EPRA Earnings, SEK m 927 921EPRA EPS, SEK/share 6.96 6.91EPRA NAV, SEK m 20,809 17,556EPRA NAV, SEK/share 156.21 131.78EPRA NNNAV, SEK m 19,234 16,379EPRA NNNAV, SEK/share 144.38 122.95EPRA Vacancy rate 7 % 6 %

Share priceEPRA NNNAVEPRA NAV

60

80

100

120

140

160

SEK/share

20162015201420132012

EPRA NAV, EPRA NNNAV and share price

17Q4 2016 ATRIUM LJUNGBERG

QUARTERLY SUMMARYINCOME STATEMENTS

Amounts in SEK m2016

Q42016

Q32016

Q22016

Q12015

Q42015

Q32015

Q22015

Q1Rental income 553 535 538 524 551 534 522 515Sales, project and construction work 35 37 37 40 87 109 85 66Net sales 588 572 575 564 638 643 607 580Property management costs –211 –151 –164 –167 –185 –151 –165 –170Project and construction work costs –35 –44 –41 –41 –99 –118 –85 –70Gross profit/loss 342 377 371 356 354 374 357 341– of which gross profit property management (operating surplus) 342 384 375 357 366 383 357 344– of which gross profit/loss from project and construction work –1 –7 –4 –1 –12 –9 –1 –4

Central administration, property management –17 –16 –20 –30 –21 –13 –13 –13Central administration, project and construction work –5 –3 –4 –3 –4 –3 –4 –4

–22 –19 –24 –33 –25 –16 –18 –17

Financial income and expenses –92 –93 –98 –100 –101 –100 –101 –101

Profit/loss before changes in value 228 265 249 223 227 257 238 223

Properties, unrealised changes in value 1,483 316 959 14 928 216 818 366Properties, realised changes in value – 13 –1 –6 –44 – 1 –Derivatives, unrealised changes in value 307 –54 –248 –311 161 –165 403 –199

1,790 275 710 –303 1,045 50 1,222 168

Profit/loss before tax 2,018 539 959 –80 1,272 307 1,460 391Tax –457 –121 –199 22 –173 –68 –322 –85Profit for the period 1,561 418 760 –57 1,100 240 1,138 306

KEY RATIOS 2) 3)

Property-related key ratios2016

Q42016

Q32016

Q22016

Q12015

Q42015

Q32015

Q22015

Q1Letting rate, % 93 94 94 94 94 94 94 93Operating surplus margin, % 62 72 69 68 67 72 68 67Letting area, 1,000 m2 (period end) 1,124 1,105 1,077 1,052 1,034 1,110 1,110 1,064Investments in properties, SEK m 382 213 206 201 268 187 164 149Number of properties (period end) 50 50 50 49 48 52 52 49

Financial key ratiosEquity/assets ratio, % 43.7 41.3 41.8 43.1 43.7 40.4 39.7 39.8Gearing ratio, % 41.9 43.7 43.6 41.8 43.0 45.6 44.6 46.4Adjusted gearing ratio, % 41.9 43.7 43.6 42.0 43.0 45.6 45.9 46.4Interest coverage ratio, multiple 3.5 3.8 3.5 3.2 3.2 3.5 3.4 3.2Average interest rate for interest-bearing liabilities, % 2.5 2.3 2.5 2.8 2.9 2.8 2.8 3.0Return on shareholders’ equity, % 40.6 11.6 21.6 –1.7 32.8 7.5 37.2 10.4Return on shareholders’ equity, excluding changes in value, % 4.9 5.9 5.6 5.4 5.7 6.6 6.4 5.9Return on total assets, % 23.3 7.3 12.8 0.3 17.2 5.1 20.3 6.6Return on total assets excluding changes in value, % 3.6 4.2 4.2 4.1 4.3 4.6 4.5 4.4

Data per share Earnings per share, SEK 11.72 3.14 5.70 –0.43 8.25 1.80 8.54 2.29Profit/loss before changes in value less applicable nominal tax, SEK 1.34 1.55 1.46 1.31 1.33 1.50 1.40 1.30EPRA EPS, SEK 1.73 1.85 1.79 1.59 1.75 1.86 1.68 1.61Cash flow, SEK 1.85 2.46 1.17 1.64 1.73 1.59 1.99 2.25Shareholders’ equity, SEK 121.42 109.68 106.51 104.33 104.73 96.45 94.62 89.34EPRA NAV, SEK 156.21 143.36 139.01 133.46 131.78 123.58 120.07 115.59EPRA NNNAV, SEK 1) 144.38 130.19 126.40 122.73 122.95 113.89 111.48 104.95Share price at period end, SEK 142.30 149.60 136.50 140.50 133.00 126.60 108.50 131.30Average number of outstanding shares, ‘000 133,221 133,221 133,221 133,221 133,221 133,221 133,221 133,221Number of outstanding shares at end of period, thousand 133,221 133,221 133,221 133,221 133,221 133,221 133,221 133,221

1) For calculation of EPRA NNNAV, an estimated deferred tax of 4.0 per cent has been used.2) See reconciliation for key ratios on Atrium Ljungberg’s website.3) For definitions, see pages 22 and 23.

18 Q4 2016 ATRIUM LJUNGBERG

PARENT COMPANY

INCOME STATEMENTS PARENT COMPANY SUMMARY BALANCE SHEETS PARENT COMPANY

The Parent Company’s operations comprise Group-wide functions and the organisation for the management of the properties owned by the Parent Company and the subsidiary companies.

Net sales totalled SEK 343 million (SEK 378 m). Operating profit/loss totalled SEK 14 million (SEK 59 m). The profit/loss after finan-cial items totalled SEK 744 million (SEK 726 m).

Interest-bearing liabilities amount to SEK 13,027 million (SEK 9,685 m). These funds finance the parent company’s property port-folio and are lent on to other Group companies.

2016 2015

Amounts in SEK m 1/1–31/12 1/1–31/12Rental income 169 169Management income 175 209Net sales 343 378

Property expenses –57 –58Management and administration expenses –254 –240Depreciation –19 –20Operating profit/loss 14 59

Result of participations in Group companies 665 620Interest income and similar profit/loss items 484 473Interest expenses and similar profit/loss items –418 –426

731 667

Profit/loss after financial items 744 726Appropriations –50 –139

Profit/loss before tax 694 587Current tax 0 –12Deferred tax –16 –22

–16 –34Profit for the period 678 553

Amounts in SEK m 31/12/2016 31/12/2015ASSETSTangible fixed assets 1,497 1,439Financial fixed assets 461 2,613

Current assets 20,575 14,721Total assets 22,533 18,773

TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIESShareholders’ equity 7,602 7,401Untaxed reserves 50 42Provisions 277 258Long-term liabilities 11,310 8,934Current liabilities 3,293 2,138Total shareholders’ equity and liabilities 22,533 18,773

OTHER INFORMATION

CORPORATE SOCIAL RESPONSIBILITYOne of Atrium Ljungberg’s overall operational goals is Corporate Social Responsibility. We have defined four sustainability goals in this context. All our major new construction projects should be en-vironmentally certified, premises in accordance with BREEAM, res-identials in accordance with Environmental Building and the energy consumption per square metre should decrease by 20 per cent be-tween the years 2014 and 2021. By 2021, the proportion of green lease contracts is also to be 50 per cent of the contracted annual rent. Finally, we shall be one of Sweden’s best workplaces. The goals are monitored annuallyin our Annual Reports.

MARKET DEVELOPMENT, RISKS AND UNCERTAINTY FACTORSAtrium Ljungberg’s property portfolio, with retail, offices and full-service environments, is primarily located in strong subsidiary

markets in the expanding regions Stockholm, Uppsala, Malmö and Gothenburg. The primary prioritised risk management areas, in light of both their complexity and size of the amounts involved, are letting, property valuation, project activities and financing. The company has good procedures for managing these risks. The com-pany also has a strong financial position with strong key ratios, such as a low gearing ratio and high interest coverage ratio.

Several tax investigations are ongoing, which is creating uncer-tainty and could mean higher taxes for the property sector in form of limitation of tax deduction related to interest expenses, in-creased title deeds costs and increased taxation on sales of prop-erties.

For further information on risks and uncertainty factors in gen-eral, please see Atrium Ljungberg’s 2015 Annual Report and the section entitled “Risks and risk management” on pages 97–101.

19Q4 2016 ATRIUM LJUNGBERG

RETAIL SECTOR’S SALES TRENDAccording to the Swedish Retail Sales Index (DHI), total retail sales in Sweden increased by 3.3 per cent in 2016. The stores within our five largest retail hubs – Sickla, Farsta Centrum, Port 73, Gränby-staden and Mobilia – collectively reported a net sales increase of 4.0 per cent compared to last year.

SEASONAL EFFECTS The operating surplus is impacted by seasonal variations in operat-ing costs. Generally costs are higher during the first and last quar-ter of the year, primarily caused by higher costs of heating and property maintenance.

ONGOING DISPUTESOn 3 June Nacka District Court communicated its judgment in the dispute with Casco Adhesives AB (Akzo Nobel). The dispute refers to the revocation of a lease contract which was conducted in 2013 re-garding renting of premises in Sickla Front I, Nacka. The District Court established that Casco Adhesives AB is liable to pay damages to Atrium Ljungberg and has an obligation to indemnify for the litiga-tion costs. The amount of damages will be tried in separate court proceedings. Casco Adhesives AB has appealed the judgment to Svea Court of Appeal and has been granted leave to appeal. The date of court proceedings is confirmed as the end of March 2017.

ORGANISATIONMonica Fallenius was appointed as the new director of the business area Transaction and establishment. Monica assumed her role on 1 February 2017 and is a member of the company management.

WHISTLEBLOWINGWe manage our company in a long-term and sustainable manner. It is therefore important that improprieties which affect Atrium Ljungberg and which may seriously injure our staff are highlighted, investigated and prevented in as early a stage as possible. We have therefore established a whistleblowing service through an external party. In this manner we can guarantee a system with highest se-crecy and total anonymity which makes it safe for our employees, customers and collaboration partners to submit a complaint. Com-plaints can be submitted on our website.

ACCOUNTING PRINCIPLESAtrium Ljungberg’s consolidated accounts have been prepared in accordance with the International Financial Reporting Standards (IFRS). The Interim Report has been prepared in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Ac-counts Act. The Parent Company applies Swedish Financial Report-ing Board’s recommendation, RFR2 Accounting for Legal Entities, and the Swedish Annual Accounts Act. The accounting principles ap-plied conform to those described in the 2015 Annual Report.

New and revised standards from IFRS and interpretations from IFRIC to be applied by the Group as of 1 January 2016 have had no effect on the Group’s results or financial position.

Valuation method for investment propertiesInvestment properties are valued at fair value in the Balance Sheet. The valuation took place in accordance with level 3 in the IFRS valua-tion hierarchy.

Valuation method for derivativesDerivatives (interest swap agreements) are valued at fair value in the Balance Sheet. Pursuant to the IFRS valuation hierarchy, the fair value of derivatives has been valued in accordance with level 2. This level means that the valuation is based on input data other than the listed prices, and which are observable for the asset or the liability, either directly or indirectly. The derivative agreements (IS-DA-agreements) include an option to net obligations in respect of the same counterparty.

Fair value interest-bearing liabilitiesAccording to the Balance Sheet, the Group’s reported interest-bear-ing liabilities total SEK 14,947 million (SEK 13,261 m) and their fair value totals SEK 14,991 million (SEK 13,318 m). The fair value calcu-lation is based on discounted estimated future cash flows. The dis-counting is effected on the basis of current market rates plus the relevant borrowing margin. The valuation is hereby conducted with IFRS valuation hierarchy level 2. Atrium Ljungberg is of the opinion, with regard to other financial assets and liabilities reported at ac-crued acquisition value, that the differences between book values and fair values are insignificant.

EPRAAs of 1 January 2015, Atrium Ljungberg reports EPRA EPS, EPRA NAV as well as EPRA NNNAV in accordance with the European Public Real Estate Association’s definitions.

For calculation of EPRA NNNAV (the triple net asset value), an estimated deferred tax of 4.0 per cent has been used for properties. The calculation of the tax rate is based on a discount rate of 3.0 per cent (real) and that the property portfolio is realised over 50 years, where 10 per cent of the properties are sold directly with a nominal tax rate of 22 per cent and that 90 per cent are sold indirectly through transfer of shares with a tax deduction for the buyer of 6 per cent.

Alternative Performance MeasuresAtrium Ljungberg applies the guidelines of the European Securities and Markets Authority (ESMA) on Alternative Performance Meas-ures (APMs). The guidelines aim to make APMs in financial reports more comprehensible, reliable and comparable and thereby pro-mote their applicability.

According to these guidelines, an APM is a financial measure of historical or future profit performance, financial position, financial results or cash flows which are not defined or stated in applicable rules for financial reporting; IFRS and the Swedish Annual Ac-counts Act.

Reconciliation of APMs is available on Atrium Ljungberg’s web-site, www.al.se.

20 Q4 2016 ATRIUM LJUNGBERG

EVENTS AFTER THE CLOSING DAYAt the city council meeting of the City of Stockholm on 13 February, the sale of Fatburen 2 was decided in accordance with a previously communicated policy decision. In February Atrium Ljungberg was awarded a public investment grade rating of Baa2 with stable outlook from the credit rating agency Moody’s.

OUTLOOK FOR 2017Atrium Ljungberg’s conditions are good. The higher urbanisation and population growth continue to drive growth in the metropolitan regions, where we are established. The investment volume in own properties for 2017 is assessed to amount to approximately SEK 1.5 billion. The forecast for profit before changes in value amounts to SEK 1,055 million in compari-son to SEK 965 million for 2016. The forecast includes acquisition of the property Fatburen 2. The forecast net profit after tax is SEK 822 million, corresponding to SEK 6.17/share. Changes in value and any other future property acquisitions and sales have not been taken into account in the fore-cast.

DIVIDEND Dividend payments shall correspond to at least 50 per cent of the profit before changes in value, after estimated tax, unless invest-ments or the company’s financial position otherwise justify a devia-tion from this policy. A dividend of SEK 3.95 per share (SEK 3.55/share) is proposed for the financial year, which corresponds to a divi-dend of SEK 69.9 per cent of the distributable profit (SEK 64.1/share) and a dividend yield of 2.8 per cent (2.9%).

ANNUAL GENERAL MEETING The Annual General Meeting (AGM) will be held on Wednesday, 5th April 2017 at 17.00 (CET) in the SF bio building, at Marcusplatsen 19 in Sickla, Nacka. Notices convening the AGM will be sent by let-ters in the post to shareholders and the AGM will also be adver-tised in Post- och Inrikes Tidningar (the Official Swedish Gazette). A statement that the AGM has been convened will be published in the Dagens Nyheter daily newspaper. The Annual Report will be availa-ble on Atrium Ljungberg’s website no later than three weeks before the AGM and will also be distributed by post to shareholders who have requested a printed version. Please see the company’s web-site (www.al.se) for full details of the Nomination Committee’s pro-posals and of the items on the agenda for the AGM.

CAPITAL MARKET DAYAtrium Ljungberg will hold a capital market day on 24 February 2017 at 09.00 (CET) on Slöjdgatan in Stockholm. The event will be broadcast live and can be followed on our website www.al.se or on our YouTube channel.

The Interim Report has not been subject to review by the compa-ny’s auditors.

Nacka, 23 February 2017

BOARD OF DIRECTORS

21Q4 2016 ATRIUM LJUNGBERG 21

In October 2016 we received the award “BREEAM project of the year” for our sustainability work in Gränbystaden in Uppsala. The motivation of the award emphasises target-oriented work on integrating a building in its immediate surroundings by extending social functions, building new playgrounds and meeting places, and improving public transport.

22 Q4 2016 ATRIUM LJUNGBERG22

DEFINITIONS

FINANCIAL DEFINITIONS

Adjusted gearing ratio, % Interest-bearing liabilities as a percentage of the sum of the proper-ties’ fair values at the end of the period, less properties acquired but not possessed and plus properties sold but not vacated. The adjusted gearing ratio is used to illustrate Atrium Ljungberg’s financial risk.

Average capital commitment, yearsAverage remaining term until final maturity of all credits in the liabilities portfolio. The average capital commitment is used to illustrate Atrium Ljungberg’s financial risk.

Average fixed interest, yearsAverage remaining term until interest settlement date of all credits in the liabilities portfolio. The average fixed interest is used to illustrate Atrium Ljungberg’s financial risk.

Average interest rate for interest-bearing liabilities, %Weighted average contracted interest for all credits in the liabilities portfolio at the end of the period excluding unutilised credit facilities. The average interest is used to illustrate Atrium Ljungberg’s fi-nancial risk.

Average number of outstanding shares Weighted average number of outstanding shares calculated in ac-cordance with IAS 33.

Cash flow per share, SEK Cash flow from operating activities divided by the average number of outstanding shares. Cash flow per share, SEK is used to illustrate Atrium Ljungberg’s cash flow, and particularly its dividend capacity.

Dividend pay-out ratio, % Dividend per share as a percentage of the profit/loss per share be-fore changes in value, less applicable nominal tax. Dividend pay-out ratio is used to illustrate how large share of the results is shifted out to the Group’s owners and reinvested in the operations respectively.

Earnings per share, SEK Net profit/loss for the period divided by the average number of out-standing shares after dilution.

EPRA The European Public Real Estate Association is a trade organisa-tion for publicly listed real estate companies and investors in Eu-rope which sets standards for the financial reporting.

EPRA EPS (EPRA Earnings per share), SEK Profit/loss before changes in value, less calculated current tax ex-cluding loss carry-forwards, divided by the average number of out-standing shares. The deducted tax has been calculated by taking into account tax deductible depreciation and investments. EPRA EPS is used to provide stakeholders information on Atrium Ljungberg’s management result per share calculated in a uniform manner for publicly listed real estate companies.

EPRA NAV (Net Asset Value) per share, SEKReported shareholders’ equity with reversal of goodwill, interest derivatives and deferred tax, divided by the number of outstanding shares at the end of the period. EPRA NAV per share is used to provide stakeholders information on Atrium Ljungberg’s current net worth per share calculated in a uniform manner for publicly listed real estate companies.

EPRA NNNAV) (Triple Net Asset Value) per share, SEKReported shareholders’ equity with reversal of goodwill adjusted with estimated actual deferred tax, divided by the numberof outstanding shares at the end of the period. EPRA NNNAV per share is used to provide stakeholders informa-tion on Atrium Ljungberg’s long-term net worth per share calculat-ed in a uniform manner for publicly listed real estate companies.

Equity/assets ratio, % Reported shareholders’ equity as a percentage of the balance sheet total at the end of the period. The equity/assets ratio is used to illustrate Atrium Ljungberg’s interest rate sensitivity and financial stability.

Equity per share, SEK Reported equity divided by the number of outstanding shares at the end of the period. Equity per share is used to illustrate the owners’ share of the company’s total assets per share.

Gearing ratio, % Interest-bearing liabilities as a percentage of the sum of the proper-ties’ fair value at the end of the period. The gearing ratio is used to illustrate Atrium Ljungberg’s finan-cial risk.

Gross profit/loss project and construction work Project and construction sales minus project and construction costs.

Gross profit/loss property management Rental income less property management costs.

Interest coverage ratio, multiple Profit/loss before changes in value, plus interest expenses divided by interest expenses.

The interest coverage ratio is used to illustrate how sensitive the company’s profit/loss is to interest rate changes.

Number of outstanding shares Number of registered shares at the end of the period less bought-back shares, which do not provide entitlement to dividend or voting rights.

Profit/loss before changes in value per share, SEK Profit/loss before changes in value, less current tax, divided by the average number of outstanding shares. Profit/loss before changes in value per share is used to illus-trate the ongoing management operations.

Property costsTotal property management costs, which exclude central adminis-tration.

23Q4 2016 ATRIUM LJUNGBERG 23

Return on shareholders’ equity, excluding changes in value, %Net profit/loss for the year as a percentage of average sharehold-ers’ equity excluding changes in value. Return on shareholders’ equity excluding changes in value is used to illustrate Atrium Ljungberg’s capacity to generate current cash flow on the owners’ capital in the Group.

Return on total assets excluding changes in value %Profit/loss before changes in value plus interest expenses as a per-centage of the average balance sheet total.¬ Return on total assets excluding changes in value is used to il-lustrate Atrium Ljungberg’s capacity to generate current cash flow on the Group’s assets uninfluenced by the Group’s financing.

Share dividend yield, % The proposed share dividend as a percentage of the share price at the end of the previous year. The share’s dividend yield is used to illustrate which current yield shareholders are expected to receive.

Share’s total yield, %The year’s change in the share price plus the paid dividend during the year as a percentage of the share price at the end of the previ-ous year. The share’s total yield is used to illustrate the shareholders’ to-tal yield on their ownership in Atrium Ljungberg.

PROPERTY-RELATED DEFINITIONS

BREEAMIs an environmental certification system developed in Europe for built environments. BREEAM takes a big picture approach to envi-ronmental performance. The areas addressed by BREEAM are en-ergy and water consumption, health, transport, materials, waste, land usage, emissions, ecology and management.

EPRA Vacancy rate, %The rental value of unlet premises divided by the rental value of the entire property portfolio. Project properties are excluded. The EPRA Vacancy rate is reported in accordance with the EPRA’s definition of vacancy rate, which enables comparison be-tween different companies.

GFA, m² GFA (Gross Floor Area) refers to the building’s total area, including outer walls.

Environmental BuildingEnvironmental Building is a certification system for buildings which are based on Swedish construction practice and covers energy, the indoor environment and material.

Letting area, m² Total area available for letting.

Letting rate, % Contracted annual rents as a percentage of the rental value in con-junction with full letting. Reported figures are based on the imme-diately subsequent quarter. The letting rate is used to illustrate the Group’s efficiency in the use of its investment properties.

Like-for-like portfolioLike-for-like portfolio refers to the properties which were not clas-sified as project properties and were owned throughout the period and entire comparison period. Like-for-like portfolio is used to illustrate the trend of rental in-come excluding non-recurrent effects for premature vacating of premises and property expenses uninfluenced by project properties as well as acquired and sold properties.

Net lettingTotal contracted annual rent for new lettings less annual rents ter-minated due to notice to leave premises during the period. Net letting is used to illustrate the letting situation.

Operating surplus Refers to Gross profit/loss in property management.

Operating surplus margin, % Gross profit/loss from property management as a percentage of the reported rental income. Operating surplus margin is used to illustrate how large share of the Group’s rental income remains after property costs. The op-erating surplus margin also forms the basis of valuation of the Group’s investment properties.

Premises typeThe operations managed in the individual premises determine the premises type: retail, offices, residentials or other. Other includes, among other things, education, culture and service enterprises. The letting rate and yield requirement are reported per premis-es type.

Project property An individual property or a clearly delimited part of a property that has been vacated in order to permit the renovation and upgrading of the property. The term, project property, also refers to buildings under construction and to undeveloped land and development rights. Reclassification from project property to completed property occurs on 1 January of the year after completion.

Project return, %Market value after completed project minus total investment as a percentage of total investment. Project return is used to illustrate value creation in the project activities.

Property typeThe premises type which comprise the predominant share of the rental value of a register property determine the property type. The market value is reported per property type.

Rental value Contracted annual rents including rent surcharges (e.g. for proper-ty tax and electricity) and estimated market rents for vacant space in existing condition. Rental value is used to illustrate the Group’s income potential.

FACTS Number of properties 50

Property value, SEK billion 36

Contracted annual rent, SEK billion 2.2

Total letting area, 1,000 m2 1,124

Letting rate, % 93

Number of employees 281

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Atrium Ljungbergaktien

Atrium Ljungberg owns, develops and manages properties. Our primary focus is on retail and offices, but our vibrant urban environments also include residential properties and cultural, service and educational facilities. We create city districts where people want to be, today and tomorrow. We are located where Sweden is growing: Stockholm, Uppsala, Malmö and Gothenburg.

Deciding to build attractive spaces for the future is every bit as obvious to us as deciding to create long-term value – for us, our customers and for society.

Atrium Ljungberg has been listed on the NASDAQ Stockholm Exchange since 1994.

ABOUT US

A stable dividend yield – The dividend yield over the last five years was 3.0 per cent. The dividends paid by the company since its flotation in 1994 have never fallen in SEK per share.

Low risk – The company’s operations are stable and its financial position is strong, with solid key ratios such as a low gearing ra-tio and high interest coverage ratio.

Potential for good value growth – With a planned investment rate of SEK 1 billion per year and a goal of 20 per cent returns on new build and extension projects, the company – and hence the share – has excellent potential for good value growth over time.

Sustainable urban development – The sustainability work is inte-grated in the business model where we continuously develop our areas in a sustainable direction. We are a long-term player that takes responsibility for the impact of our business on human beings and the environment.

FOUR REASONS TO OWN SHARES IN ATRIUM LJUNGBERG

BUSINESS CONCEPTOur long-term approach to ownership, development and management enables us to offer our customers attractive urban environments for retail, office and res-identials in strong subsidiary markets. Our in-house expertise and holistic per-spective enable us to generate added value for our customers and partners and to create value growth within the company.

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BUSINESS MODELAtrium Ljungberg’s business model creates profitability and value growth, mostly through long-term property ownership, management and improve-ment, as well as through project development of properties. Our construction business also contributes to profitability, as do our property acquisitions and sales.

GOALSAtrium Ljungberg’s operations focus on growth in the operating surplus. This, together with a stable capital structure, generates excellent conditions for good growth in value. Our goals are divided into three areas:

PROFITABILITY AND GROWTH The operating net shall increase by 10% per annum, we shall invest SEK 1 billion each year in in-house projects, and the return on new build and extension projects shall be 20%. The dividend shall correspond to a minimum of 50% of the profit before changes in value, after nominal tax.

LONG-TERM STABILITYThe minimum equity/assets ratio shall be 30% and the inter-est coverage ratio shall be a multiple of 2.0.

CORPORATE SOCIAL RESPONSIBILITYAll major new builds are to be environmentally certified – business premises in accordance with BREEAM and residen-tial properties in accordance with the Sweden Green Building Council’s Environmental Building certification. Energy con-sumption per m² is to decrease by 20 % between 2014 and 2021. By 2021, the proportion of green lease contracts is to be 50% of the contracted annual rent. We shall be one of Sweden’s best workplaces.

STRATEGIES Focus on developing environments for retail and of-

fice operations and, where possible, add housing, service, culture and education.

Develop and improve properties and development rights.

Operate in strong subsidiary markets in large urban regions.

Be a significant player with large, unified units in each subsidiary market.

Our focus, in everything we do, shall be on our customers. Collaboration with custom-ers, suppliers, municipalities and other stakeholders should be close, long-term, stable and personal.

Conduct and manage the entire business process in-house using our in-house expertise.

The sustainability work should be inte-grated in the business strategy and should comprise an important compo-nent of our offering.

Have committed employees who are passionate about what we do.

Box 4200, SE-131 04 Nacka. Street address: Sickla Industriväg 19Tel: +46 (0)8 615 89 00, info@al.seRegistered office: Nacka, Corporate ID no.: 556175-7047, www.al.se

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INFORMATION FROM ATRIUM LJUNGBERGTHE INFORMATION we release to the market concerning Atrium Ljungberg’s op-erations shall be transparent, clear and correct in order to build market confi-dence in our company and our brand.

AS A LISTED COMPANY Atrium Ljungberg is subject to the rules of the listing agree-ment with the NASDAQ Stockholm exchange. Significant events, interim reports and preliminary financial statements are published immediately via press releases and the information is also available on the company’s website: www.al.se.

REGULAR MEETINGS WITH analysts, investors, shareholders and financiers, and with our customers and partners, enable us to provide ongoing information on our company, current events and operational changes.

THE ANNUAL REPORT and interim reports are available on our website. The an-nual report is also distributed in printed format by post to shareholders who have actively requested it. Interim reports and preliminary financial statements are translated into English and all language versions are published simultaneously on our website. The annual reports are translated into English shortly after the publication of the Swedish language version.

INTERESTED PARTIES can subscribe to both financial reports and press releases via our website: www.al.se. The site also provides updated information on our op-erations, our properties and projects, financial key ratios, the share, and much more besides. The information on the website is also available in English.

PUBLICATION OF FINAN-CIAL INFORMATION2016 Annual Report 10/03/2017Annual General Meeting 05/04/2017Interim report Jan–Mar 2017 20/04/2017Interim report Jan–June 2017 12/07/2017Interim report Jan–Sep 2017 18/10/2017